Foursquare: Carrots Are the Killer App

Last weekend, I went to the Old Spaghetti Factory in downtown Toronto for dinner. It’s a large family-oriented restaurant that’s been around forever. For the most part, little has changed at the Old Spaghetti Factory. The decor and menu are exactly as they were a decade ago, although the prices have obviously climbed.

There are some signs of change, mostly notably the large, flat-screen televisions in the bar and, if you look closely, the use of social media. I say “closely” because as you wait in the lobby for a table, there’s a small sign slapped on the host’s dais that suggests you check in on Foursquare to get a deal.

Not being a regular Foursquare user, the opportunity to get a deal was impossible to resist so I whipped out the iPhone and checked in. Unfortunately, the deal had either ended or it wasn’t part of the database so I never got the much-anticipated discount. (Note: It turned out the restaurant dumped Foursquare for Facebook. The head of marketing suggested Foursquare will disappear soon, although I don’t share his bearish view.)

I did, however, gain some valuable insight into Foursquare’s value proposition – at least the value it holds for me and likely many other people. It’s all about the discount or the coupon. If Foursquare has a “killer app”, it’s not the strange joy of becoming the mayor of someplace you patronage far too often, or the even more bizarre pride in earning badges, which reminds me of my days long ago as a Cub (aka mini-Boy Scout).

The “killer app” for Foursquare is the deal. Give me a good deal and I’ll use Foursquare, even if means having to check in (but don’t expect me to pepper my Twitter stream with updates on my whereabouts). In the world of social media and the increasing need for brands to provide something to get something, the “carrot” rules. Consumers want carrots so they will happily do things such as check in, “Like” or “follow” to get one.

Foursquare has the potential to be a carrot machine that brands could use to attract and reward consumers and, as important, differentiate themselves from the competition who may not be offering carrots on Foursquare or not as many carrots. If a brand offers lots of carrots, consumers will check in.

In my humble opinion, Foursquare should focus on carrots, not badges or mayors. Badges and mayors are fun and entertaining but they’re candy that comes and goes quickly. Carrots, meanwhile, have staying power because everyone likes a deal and we’re willing to make an effort to get one.

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  • Ben Wise

    I agree that focusing on Mayors and Badges is a dead end. It has made the general view of Foursquare very ‘nerdy’ to the point that my friends make fun of me a bit when I check-in.
    However, I disagree that carrots are the best way to go. From a brands point of view, this will train their customers into only shopping when they get a deal, and hurt their margins.
    If Foursquare could move to the mainstream, I think there is potential for helping friends meet up more. I checked in at a Starbucks last week, and 5 minutes later a friend came by to say hello because he saw me check-in. For me that is more valuable than a 10% discount on my coffee.

  • Chris Schmitt

    I agree with the carrot concept, otherwise what value would Foursquare ever bring to the “table” (at least things people would pay for). The challenge is why would any restaurant put their time and energy into Foursquare when Facebook has probably 100x more users?

    PS – love that you tagged your post with “carrots”

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